Government Revises Premium Rates of Various Insurance Schemes.

Government Revises Premium Rates of Various Insurance Schemes.

The premiums for the Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) and Pradhan Mantri Suraksha Bima Yojana (PMSBY) will be Rs 436 and Rs 20 respectively

The government has increased the premium rates for the Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) and Pradhan Mantri Suraksha Bima Yojana (PMSBY). The premium for PMJJBY has been raised from Rs. 330 to Rs. 436, while the premium for PMSBY has been raised from Rs. 12 to Rs. 20.

The premium rates for both schemes have been amended, with a daily premium of Rs 1.25 for each.

PMJJBY is a one-year life insurance policy for a life cover of Rs. 2 lakhs (term insurance), renewed from year to year, and available to people aged 18 to 50 (life cover up to age 55) who have a savings bank account and provide their approval to enroll and allow auto-debit. The coverage will last for a year, from June 1 to May 31.

The Pradhan Mantri Suraksha Bima Yojana (PMSBY) is a government-sponsored plan that provides coverage for accidental death and disability. It is a one-year cover that may be renewed by the person each year. For individuals who have previously registered in the PMSBY plan, the premium is debited in one payment from the insured’s bank account using an ‘auto-debit’ function. Each year, between May 25 and May 31, your bank account will be debited.

As of 31.3.2022, there were 6.4 crore and 22 crore active members enrolled in PMJJBY and PMSBY, respectively. As of 31.3.2022, the implementing insurers had collected Rs 1,134 crore in premium and had paid Rs 2,513 crore in claims under the PMSBY.

Furthermore, as of 31.3.2022, the implementing insurers had collected Rs. 9,737 crores in premium and had paid Rs. 14,144 crores in claims under PMJJBY.

The DBT route was used to deposit claims under both Schemes into the recipients’ bank accounts.

It was decided at the time of the schemes’ launch in 2015 that the premium amount (Rs. 12 for Pradhan Mantri Suraksha Bima Yojana and Rs. 330 for Pradhan Mantri Jeevan Jyoti Bima Yojana) will be reviewed annually depending on claims experience.

Despite repeated losses to insurers, no premium rate revisions were made in the previous 7 years since the schemes’ commencement.

IRDAI informed that while the claims ratio (percentage of a number of claims paid to the premium earned) pertaining to PMJJBY and PMSBY is 145.24 percent and 221.61 percent respectively for the period up to 31st March, 2022, the combined ratio (sum of claims ratio and expense ratios) pertaining to PMJJBY and PMSBY is 163.98 percent and 254.71 percent respectively for the period up to 31st March, 2022.

The premium rates of PMJJBY and PMSBY have been changed with effect from 1.6.2022. This is due to the adverse claims experience of the schemes, PMJJBY and PMSBY, and in order to make them feasible for the implementing insurers.